Multifamily Mortgage Flow Down

Multifamily Mortgage Flow Down NEW YORK, NY - First-quarter commercial and multifamily mortgage loan originations fell 70% from last year, and more than 25% from the previous quarter, as all categories saw declines. The year-over-year decrease was seen across all investor groups and most property types.

"In the first quarter of 2009 we saw the effects of the continued recession coupled with little demand from borrowers and a constrained supply from lenders as a result of the credit crunch," Jamie Woodwell, Vice President of Commercial Real Estate Research at the Mortgage Bankers Association, said Wednesday.

The group said the biggest decline in originations was for hotel properties, which fell 88% from a year ago. Close behind, loans for health care properties fell 80% and retail property loans fell 76%, while and office property loans fell 66%.

Multifamily originations fell 61% and industrial property loans fell by half.

It was no surprise that originations have fallen over last year's levels, as credit dried up, foreclosures rose sharply and millions of Americans lost their jobs.

U.S. foreclosure filings in April rose to a record, affecting one in every 374 housing units, and bank repossessions in particular may spike in the next few months, RealtyTrac reported Wednesday.

Foreclosure filings - defined as default notices, auction-sale notices, and bank repossessions - were reported on 342,038 U.S. properties in April, up less than 1% from March and up 32% from April 2008, the Irvine, Calif., real-state consulting firm reported.

RealtyTrac began issuing its report on foreclosures in January 2005.

Also, as that economic deterioration continued in the first quarter, loan originations continued to fall from quarter-to-quarter as well. Originations fell 26% in the first quarter compared with the last quarter of 2008.

Adding to the decline, mortgage refinance activity slowed after peaking in the middle of April, while applications for mortgages to buy homes have been steadily on the rise, the Mortgage Bankers Association's latest data show.

Overall, mortgage application volumes for the latest week were down a seasonally adjusted 8.6% from the last week of April, according to the Washington-based MBA's survey released Wednesday. Week-to-week applications had risen 2% in the period ended May 1.
Source: WSJ.com

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